June 26, 2023

It is with great sadness that I am announcing the closure of PGMF in Myanmar after forgiving more than $156 million in outstanding debts held by our 890,000 borrowers, ensuring that PGMF assets go to the people of Myanmar. We have set aside money to repay our creditors and it is now up to the Myanmar authorities to approve those repayments. 

The decision to close Myanmar’s largest microfinance operation, which has served 2.3 million mostly women borrowers and savers for more than a quarter century, was not taken lightly. The organization’s leadership has tried ceaselessly over the last two years to secure the necessary approvals to keep it operating as a key contributor to poverty reduction and gender equality. In recent months, the government has demanded that as a price for approval, PGMF hand over a share of the organization’s profits and that all its assets go to the government in the future. This was impossible to comply with for many reasons, including that it could be in breach of U.S. sanctions law. 

The government has also restricted PGMF’s ability to operate in other ways: it banned PGMF from providing new loans to clients; and it denied visas for the organization’s senior leadership. Strict foreign exchange controls further limit PGMF’s operations. A registration law enacted last year imposes criminal penalties and bans nongovernmental organizations, such as PGMF, from offering microfinance loans. By denying us the ability to register, the government has forced us either to leave Myanmar or to operate illegally. 

In addition to our borrowers and creditors, our priority now is our staff. The closure of PGMF is of great sadness for us as an employer. In recognition of the hard work and dedication of the organization’s staff, management has pre-paid salary and benefits, as well as a bonus, to all the PGMF family across Myanmar. It has also honored its obligation to pay for any accrued leave not taken and for any benefits owed. 

On behalf of the PGMF leadership, I want to thank our clients, partners, employees, and lenders for their support. We stand ready to re-enter this sector when conditions permit.

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Ellen Varney, PGMF Board Chair